Data Center Market Size and Outlook 2031

Report Description

Forecast Period	2027-2031
Market Size (2025)	USD 290.79 Billion
CAGR (2026-2031)	16.21%
Fastest Growing Segment	Web Hosting Data Centers
Largest Market	North America
Market Size (2031)	USD 716.21 Billion

Market Overview

The Global Data Center Market will grow from USD 290.79 Billion in 2025 to USD 716.21 Billion by 2031 at a 16.21% CAGR. Data centers are specialized facilities comprising networked computers, storage systems, and computing infrastructure that organizations use to organize, process, and disseminate large volumes of data. The primary drivers fueling the expansion of this market include the relentless global shift toward digitalization and the exponential rise in cloud computing adoption across various industries. Furthermore, the surging demand for artificial intelligence necessitates robust computational power, acting as a critical catalyst for growth. According to AFCOM, in 2025, 80% of industry respondents anticipated significant increases in capacity requirements specifically due to artificial intelligence workloads. These fundamental drivers are distinct from temporary market trends, as they represent structural shifts in how businesses utilize digital services.

Despite this robust trajectory, the market faces a significant challenge regarding energy consumption and power availability. As facilities scale to accommodate high-density computing, securing reliable, sustainable power sources while managing carbon footprints has become a complex obstacle for operators. This issue is compounded by the limited capacity of existing utility grids to support the rapid surge in demand. Consequently, the industry must navigate the difficult balance between satisfying the immense power needs of modern infrastructure and adhering to increasingly stringent environmental efficiency standards.

Key Market Drivers

The surging demand for artificial intelligence and machine learning workloads is fundamentally reshaping the Global Data Center Market by necessitating the deployment of high-density infrastructure. As enterprises integrate generative models, operators are compelled to retrofit existing sites or construct new environments capable of supporting the extreme thermal profiles of specialized processing units. This structural shift requires advanced liquid cooling technologies and reinforced power grids to handle rack power densities that far exceed those of traditional legacy systems. The financial impact of this hardware acquisition is evident in the revenue streams of key infrastructure enablers. According to NVIDIA, August 2024, in the 'Q2 Fiscal 2025 Financial Results', the company reported data center revenue of $26.3 billion, marking a 154% year-over-year increase attributed to the accelerating global installation of AI computing platforms.

Simultaneously, the expansion of hyperscale facilities by major cloud service providers acts as a primary engine for market scalability and geographic reach. These technology giants are aggressively increasing capital expenditures to develop massive campuses that support multi-cloud architectures and ensure low-latency service delivery across diverse regions. According to Microsoft, October 2024, in the 'First Quarter Fiscal Year 2025 Earnings Release', the company's capital expenditures rose to $20 billion for the quarter, driven largely by the need to scale cloud and AI infrastructure to meet customer demand. This rapid physical expansion creates significant pressure on global utility grids and energy resources. According to the International Energy Agency, in 2024, electricity consumption from data centers, AI, and cryptocurrencies was projected to potentially double to 1,050 TWh by 2026, underscoring the immense resource intensity of this continued market growth.

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Key Market Challenges

The Global Data Center Market is currently impeded by a critical shortage of reliable power and the intensifying energy consumption required by modern, high-density computing infrastructure. As organizations rapidly deploy artificial intelligence and cloud services, the electricity demand of these facilities often outpaces the transmission and generation capabilities of local utility grids. This disparity creates a severe bottleneck where the physical construction of data centers progresses faster than the energy infrastructure needed to support them. Consequently, operators frequently face inability to energize completed facilities, directly stalling revenue generation and market expansion.

This grid congestion has resulted in measurable delays for the industry. According to the Electric Power Research Institute (EPRI), in 2024, lead times for securing necessary power connections in major data center hubs extended to between one and two years, effectively forcing a moratorium on new operations in saturated markets. This issue is further compounded by the necessity to adhere to environmental standards, which restricts the industry from utilizing carbon-intensive emergency power solutions. The resulting inability to secure timely and sustainable energy supplies acts as a hard ceiling on growth, preventing the market from fully capitalizing on the surging demand for digital services.

Key Market Trends

The Transition to Software-Defined Data Center Architectures is intensifying as enterprises actively rebalance their infrastructure strategies, prioritizing hybrid flexibility and data sovereignty. By decoupling hardware resources from management software, organizations are deploying agile private clouds that rival public offerings in performance while ensuring stricter governance and cost predictability. This strategic recalibration toward modernized on-premise environments is substantiated by Rackspace Technology, January 2025, in the '2025 State of Cloud Report', which revealed that 69% of global IT decision-makers have considered repatriating workloads from public clouds to private infrastructure to optimize operational expenses and meet security compliance mandates.

Simultaneously, the Increasing Utilization of Renewable Energy Power Purchase Agreements (PPAs) has become a decisive mechanism for operators to secure sustainable power capacity independent of traditional utility limitations. Facing grid congestion and rigorous decarbonization targets, data center providers are bypassing standard energy markets to engage in direct, large-scale procurement of wind and solar energy. This pivot to contract-based sustainability is exemplified by Google, July 2025, in the '2025 Environmental Report', where the company reported signing contracts to purchase over 8 gigawatts (GW) of clean energy generation in 2024, marking the highest annual procurement total in its history to support its expanding global footprint.

Segmental Insights

The Web Hosting Data Centers segment is recognized as the fastest-growing category within the global data center market due to the accelerating digitization of small and medium enterprises. As organizations prioritize online visibility and e-commerce capabilities, they require robust infrastructure to maintain continuous operations. Additionally, strict adherence to data sovereignty mandates such as the General Data Protection Regulation compels businesses to utilize localized hosting facilities to ensure compliance with regional legal standards. This combination of operational necessity and regulatory pressure fosters substantial investment in web hosting infrastructure to support secure and reliable data management strategies.

Regional Insights

North America maintains a leading position in the global data center market due to the high concentration of hyperscale cloud providers and major technology enterprises. This dominance is driven by the extensive adoption of cloud computing and artificial intelligence applications which require significant processing power and storage capacity. Additionally, the region benefits from established telecommunications infrastructure that supports reliable high-speed connectivity for enterprise operations. Continuous capital investment in facility expansion across the United States ensures the region effectively meets the escalating demand for digital infrastructure and data management services.

Recent Developments

In September 2024, Oracle and Amazon Web Services announced a strategic partnership to launch "Oracle Database@AWS," a new offering that allows customers to access Oracle Autonomous Database on dedicated infrastructure within AWS. This collaboration was designed to provide a unified experience between Oracle Cloud Infrastructure and AWS, simplifying database administration, billing, and customer support. The initiative enabled enterprises to connect their data across multiple clouds with a low-latency network connection, facilitating the migration of mission-critical workloads. This move represented a significant milestone in the multi-cloud era, addressing the growing demand for flexibility and interoperability in cloud services.
In June 2024, Hewlett Packard Enterprise and NVIDIA announced a comprehensive collaboration to deliver "NVIDIA AI Computing by HPE," a portfolio of co-developed AI solutions. The partnership introduced "HPE Private Cloud AI," a first-of-its-kind turnkey solution that integrated NVIDIA's AI computing, networking, and software with HPE's AI storage and compute capabilities. This joint offering aimed to accelerate the adoption of generative AI in enterprises by providing an energy-efficient and scalable path for developing and deploying AI applications. The collaboration utilized a joint go-to-market strategy to help businesses across various industries run complex AI workloads.
In April 2024, Google Cloud announced the launch of "Google Axion," its first custom Arm-based central processing unit (CPU) designed specifically for the data center. The new processor was engineered to deliver industry-leading performance and energy efficiency, offering up to 50% better performance than comparable current-generation x86-based instances. Axion was built using the Arm Neoverse V2 CPU to support general-purpose workloads such as web and app servers, containerized microservices, and data analytics. This product launch highlighted the company's significant investment in custom silicon to optimize infrastructure for performance and sustainability in the global data center market.
In March 2024, NVIDIA launched the Blackwell platform, a new generation of AI computing designed to power real-time generative AI on trillion-parameter large language models. The platform featured the new B200 GPU, which offered significantly lower cost and energy consumption compared to its predecessor. This launch marked a major breakthrough in data center technology, with the architecture featuring six transformative technologies for accelerated computing. The platform was adopted by major cloud providers and server makers to unlock advancements in data processing, engineering simulation, and electronic design automation, positioning the company at the forefront of the AI industrial revolution.

Key Market Players

NTT Communications Corporation
IBM Corporation
Hitachi Ltd
Cisco System Inc
Amazon.com Inc.
Oracle Corporation
SAP SE
Microsoft Corporation
Hewlett Packard Enterprise Company
Equinix, Inc.

By Type	By Density	By End-User	By Region
Corporate Data Centers Web Hosting Data Centers	Low Medium High Extreme	Banking & Financial Services Telecom & IT Government Healthcare	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Data Center Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

Data Center Market, By Type:

Corporate Data Centers
Web Hosting Data Centers

Data Center Market, By Density:

Low
Medium
High
Extreme

Data Center Market, By End-User:

Banking & Financial Services
Telecom & IT
Government
Healthcare

Data Center Market, By Region:

North America

United States
Canada
Mexico

Europe

France
United Kingdom
Italy
Germany
Spain

Asia Pacific

China
India
Japan
Australia
South Korea

South America

Brazil
Argentina
Colombia

Middle East & Africa

South Africa
Saudi Arabia
UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Data Center Market.

Available Customizations:

Global Data Center Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

Detailed analysis and profiling of additional market players (up to five).

Global Data Center Market is an upcoming report to be released soon. If you wish an early delivery of this report or want to confirm the date of release, please contact us at [email protected]

Table of content

1. Product Overview

1.1. Market Definition

1.2. Scope of the Market

1.2.1. Markets Covered

1.2.2. Years Considered for Study

1.2.3. Key Market Segmentations

2. Research Methodology

2.1. Objective of the Study

2.2. Baseline Methodology

2.3. Key Industry Partners

2.4. Major Association and Secondary Sources

2.5. Forecasting Methodology

2.6. Data Triangulation & Validation

2.7. Assumptions and Limitations

3. Executive Summary

3.1. Overview of the Market

3.2. Overview of Key Market Segmentations

3.3. Overview of Key Market Players

3.4. Overview of Key Regions/Countries

3.5. Overview of Market Drivers, Challenges, Trends

4. Voice of Customer

5. Global Data Center Market Outlook

5.1. Market Size & Forecast

5.1.1. By Value

5.2. Market Share & Forecast

5.2.1. By Type (Corporate Data Centers, Web Hosting Data Centers)

5.2.2. By Density (Low, Medium, High, Extreme)

5.2.3. By End-User (Banking & Financial Services, Telecom & IT, Government, Healthcare)

5.2.4. By Region

5.2.5. By Company (2025)

5.3. Market Map

6. North America Data Center Market Outlook

6.1. Market Size & Forecast

6.1.1. By Value

6.2. Market Share & Forecast

6.2.1. By Type

6.2.2. By Density

6.2.3. By End-User

6.2.4. By Country

6.3. North America: Country Analysis

6.3.1. United States Data Center Market Outlook

6.3.1.1. Market Size & Forecast

6.3.1.1.1. By Value

6.3.1.2. Market Share & Forecast

6.3.1.2.1. By Type

6.3.1.2.2. By Density

6.3.1.2.3. By End-User

6.3.2. Canada Data Center Market Outlook

6.3.2.1. Market Size & Forecast

6.3.2.1.1. By Value

6.3.2.2. Market Share & Forecast

6.3.2.2.1. By Type

6.3.2.2.2. By Density

6.3.2.2.3. By End-User

6.3.3. Mexico Data Center Market Outlook

6.3.3.1. Market Size & Forecast

6.3.3.1.1. By Value

6.3.3.2. Market Share & Forecast

6.3.3.2.1. By Type

6.3.3.2.2. By Density

6.3.3.2.3. By End-User

7. Europe Data Center Market Outlook

7.1. Market Size & Forecast

7.1.1. By Value

7.2. Market Share & Forecast

7.2.1. By Type

7.2.2. By Density

7.2.3. By End-User

7.2.4. By Country

7.3. Europe: Country Analysis

7.3.1. Germany Data Center Market Outlook

7.3.1.1. Market Size & Forecast

7.3.1.1.1. By Value

7.3.1.2. Market Share & Forecast

7.3.1.2.1. By Type

7.3.1.2.2. By Density

7.3.1.2.3. By End-User

7.3.2. France Data Center Market Outlook

7.3.2.1. Market Size & Forecast

7.3.2.1.1. By Value

7.3.2.2. Market Share & Forecast

7.3.2.2.1. By Type

7.3.2.2.2. By Density

7.3.2.2.3. By End-User

7.3.3. United Kingdom Data Center Market Outlook

7.3.3.1. Market Size & Forecast

7.3.3.1.1. By Value

7.3.3.2. Market Share & Forecast

7.3.3.2.1. By Type

7.3.3.2.2. By Density

7.3.3.2.3. By End-User

7.3.4. Italy Data Center Market Outlook

7.3.4.1. Market Size & Forecast

7.3.4.1.1. By Value

7.3.4.2. Market Share & Forecast

7.3.4.2.1. By Type

7.3.4.2.2. By Density

7.3.4.2.3. By End-User

7.3.5. Spain Data Center Market Outlook

7.3.5.1. Market Size & Forecast

7.3.5.1.1. By Value

7.3.5.2. Market Share & Forecast

7.3.5.2.1. By Type

7.3.5.2.2. By Density

7.3.5.2.3. By End-User

8. Asia Pacific Data Center Market Outlook

8.1. Market Size & Forecast

8.1.1. By Value

8.2. Market Share & Forecast

8.2.1. By Type

8.2.2. By Density

8.2.3. By End-User

8.2.4. By Country

8.3. Asia Pacific: Country Analysis

8.3.1. China Data Center Market Outlook

8.3.1.1. Market Size & Forecast

8.3.1.1.1. By Value

8.3.1.2. Market Share & Forecast

8.3.1.2.1. By Type

8.3.1.2.2. By Density

8.3.1.2.3. By End-User

8.3.2. India Data Center Market Outlook

8.3.2.1. Market Size & Forecast

8.3.2.1.1. By Value

8.3.2.2. Market Share & Forecast

8.3.2.2.1. By Type

8.3.2.2.2. By Density

8.3.2.2.3. By End-User

8.3.3. Japan Data Center Market Outlook

8.3.3.1. Market Size & Forecast

8.3.3.1.1. By Value

8.3.3.2. Market Share & Forecast

8.3.3.2.1. By Type

8.3.3.2.2. By Density

8.3.3.2.3. By End-User

8.3.4. South Korea Data Center Market Outlook

8.3.4.1. Market Size & Forecast

8.3.4.1.1. By Value

8.3.4.2. Market Share & Forecast

8.3.4.2.1. By Type

8.3.4.2.2. By Density

8.3.4.2.3. By End-User

8.3.5. Australia Data Center Market Outlook

8.3.5.1. Market Size & Forecast

8.3.5.1.1. By Value

8.3.5.2. Market Share & Forecast

8.3.5.2.1. By Type

8.3.5.2.2. By Density

8.3.5.2.3. By End-User

9. Middle East & Africa Data Center Market Outlook

9.1. Market Size & Forecast

9.1.1. By Value

9.2. Market Share & Forecast

9.2.1. By Type

9.2.2. By Density

9.2.3. By End-User

9.2.4. By Country

9.3. Middle East & Africa: Country Analysis

9.3.1. Saudi Arabia Data Center Market Outlook

9.3.1.1. Market Size & Forecast

9.3.1.1.1. By Value

9.3.1.2. Market Share & Forecast

9.3.1.2.1. By Type

9.3.1.2.2. By Density

9.3.1.2.3. By End-User

9.3.2. UAE Data Center Market Outlook

9.3.2.1. Market Size & Forecast

9.3.2.1.1. By Value

9.3.2.2. Market Share & Forecast

9.3.2.2.1. By Type

9.3.2.2.2. By Density

9.3.2.2.3. By End-User

9.3.3. South Africa Data Center Market Outlook

9.3.3.1. Market Size & Forecast

9.3.3.1.1. By Value

9.3.3.2. Market Share & Forecast

9.3.3.2.1. By Type

9.3.3.2.2. By Density

9.3.3.2.3. By End-User

10. South America Data Center Market Outlook

10.1. Market Size & Forecast

10.1.1. By Value

10.2. Market Share & Forecast

10.2.1. By Type

10.2.2. By Density

10.2.3. By End-User

10.2.4. By Country

10.3. South America: Country Analysis

10.3.1. Brazil Data Center Market Outlook

10.3.1.1. Market Size & Forecast

10.3.1.1.1. By Value

10.3.1.2. Market Share & Forecast

10.3.1.2.1. By Type

10.3.1.2.2. By Density

10.3.1.2.3. By End-User

10.3.2. Colombia Data Center Market Outlook

10.3.2.1. Market Size & Forecast

10.3.2.1.1. By Value

10.3.2.2. Market Share & Forecast

10.3.2.2.1. By Type

10.3.2.2.2. By Density

10.3.2.2.3. By End-User

10.3.3. Argentina Data Center Market Outlook

10.3.3.1. Market Size & Forecast

10.3.3.1.1. By Value

10.3.3.2. Market Share & Forecast

10.3.3.2.1. By Type

10.3.3.2.2. By Density

10.3.3.2.3. By End-User

11. Market Dynamics

11.1. Drivers

11.2. Challenges

12. Market Trends & Developments

12.1. Merger & Acquisition (If Any)

12.2. Product Launches (If Any)

12.3. Recent Developments

13. Global Data Center Market: SWOT Analysis

14. Porter's Five Forces Analysis

14.1. Competition in the Industry

14.2. Potential of New Entrants

14.3. Power of Suppliers

14.4. Power of Customers

14.5. Threat of Substitute Products

15. Competitive Landscape

15.1. NTT Communications Corporation

15.1.1. Business Overview

15.1.2. Products & Services

15.1.3. Recent Developments

15.1.4. Key Personnel

15.1.5. SWOT Analysis

15.2. IBM Corporation

15.3. Hitachi Ltd

15.4. Cisco System Inc

15.5. Amazon.com Inc.

15.6. Oracle Corporation

15.7. SAP SE

15.8. Microsoft Corporation

15.9. Hewlett Packard Enterprise Company

15.10. Equinix, Inc.

16. Strategic Recommendations

17. About Us & Disclaimer

Report Description

Table of content

Figures and Tables

Frequently asked questions

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